Irdai levies Rs 2 cr penalty on HDFC Life Insurance for violating norms

Aug 1, 2024

The regulator cited violations of norms related to policyholders' interests, web aggregators, and insurance distributors

The Insurance Regulatory and Development Authority of India (Irdai) has imposed a penalty of Rs 2 crore on HDFC Life Insurance for violating norms. The penalty must be paid within 45 days from the receipt of the order, and additional directives have also been issued.

The regulator cited violations of norms related to policyholders' interests, web aggregators, and insurance distributors.

The regulator directed the life insurer to review its vendor management agreements and carry out due diligence before entering into outsourcing contracts. The company must also submit a detailed action plan to the regulator on outsourcing contracts and other violations.

Further, Irdai stated that the insurer must place the order before the board of the company and provide the minutes of the meeting to the regulator. An action taken report must also be submitted by the company to the regulator detailing the action taken on the directions by Irdai within 90 days of the order's receipt.

If the insurer is aggrieved by the order, they can approach the Securities Appellate Tribunal.

[The Business Standard]